Quantcast
Other Stories

Short covering in particular was triggered following the breach of technical levels, especially at $15,000 per ton for nickel. LME open interest data have been rising,which also illustrates a rise in fresh positioning..

08 Mar 2014

LONDON (Commodity Online): The rally in zinc and nickel was driven by a combination of short covering and fresh positioning, according to Barclays.

Short covering in particular was triggered following the breach of technical levels, especially at $15,000 per ton for nickel. LME open interest data have been rising,which also illustrates a rise in fresh positioning, with new longs being added by discretionary investors.

Barclays expects zinc prices to be vulnerable to increase in LME stocks if the large short position in the March contract is physically delivered against. For nickel, it expects modest uptick in prices, the risk/reward of fresh longs at current levels is unattractive.

health check of the Chinese copper industry shows that its vital statistics are weak. The SHFE/LME copper price arb has weakened further, to its weakest since May 2012. Bonded stocks are still rising (680Kt in Shanghai alone up from 525Kt in December), SHFE stocks are rising and domestic spot physical premiums have been negative for the longest period since this time last year. From these readings, China has little need for additional copper units.


YOUR RESPONSE
Click on the image to reload it
Click to reload image
COMMENTS (0)

@2013 COMMODITYONLINE ALL RIGHTS RESERVED